Lawyers opening their own practices learn things they never expected. Mostly, we learn them the hard way. Wouldn’t it be nice if someone would fill us in before we make the decision to strike out on our own?
Today, I’ll give it a shot:
Lesson #1: Hiring People Doesn’t Make You More Money
I talk to so many new lawyers who are desperate to hire help. They’re dying to hire an associate. Sometimes, hiring people is an important way to leverage yourself. I’ve written before about when it’s appropriate to hire your first employee, and unfortunately, most lawyers do it too soon.
Hiring help doesn’t always increase your take-home pay. In fact, all too often, it decreases your share of the money. I meet way too many lawyers who are working way too hard to support their team rather than themselves.
Usually, these lawyers have a spreadsheet explaining how they can charge X and pay one-third of X and pocket the difference. Unfortunately, they often don’t have enough clients who will pay X, nor do they have enough work to fully book their own time. They end up paying out more than they take in, and they cut their pay to do it. Spreadsheets don’t equal reality.
Lesson #2: Buying Stuff Isn’t the Place to Start
When I quit my job and decided to open my own office, one of the first things I did was make a list of things to buy. I got a cool laser printer and a new computer. I didn’t get an iPhone because it hadn’t yet been invented in 1990 (but I did get a great big mobile phone because I was cool and it was “essential”).
Then I started designing my business cards and letterhead. I bought all kinds of stuff like a stapler, a staple remover, and this awesome leather desk pad. I had bunches of trays for holding paper, and I bought an expensive pen. Buying stuff was my favorite part of starting up. I love to buy things.
Unfortunately, buying stuff isn’t especially helpful. I should have been spending my time (and my money) getting clients. It’s not useful to have a very cool pen if you don’t have a client. Sitting alone in a well-appointed office doesn’t feel good, and it doesn’t pay the bills. Put purchases on the task list at the bottom—way below getting clients.
Lesson #3: “They” Are Mostly Doing It Wrong
It’s so tempting to do what the other lawyers are doing. We copy one another with abandon. I wish you could get a copy of their financials before you copy them, so you’d know exactly which lawyers to copy. Unfortunately, you can’t, and what you can see is often deceiving. A leased Lexus is not an indicator of a financially successful practice.
Not only is copying financially unsuccessful lawyers a mistake, but it also makes you indistinguishable from the pack. Being a clone makes you invisible. You need to stand out if you’re going to generate business. There needs to be something about you and your practice that distinguishes you. There needs to be a reason to talk about what you’re doing. Imitating others makes you unremarkable, so there’s nothing much to say about you.
Don’t do it the way they’re doing it. Do it differently. Find something unique to emphasize. Ask them how they do it so you can do something else—something different. Don’t be a carbon copy of the competition, and you’ll avoid getting the bad results so many of “them” are getting. Be you; don’t be them.
Lesson #4: Talking to Clients Is More Important Than Winning Cases
Lack of communication is the root of most problems. It’s the source of bar grievances, bad online reviews, and negative word of mouth and is a key factor when practices struggle. Increase client communication, and you’ll increase the satisfaction of your clients.
More communication from you will dramatically increase the likelihood of your clients referring others. Oddly, at least to us lawyers, is that excellent client communication has a larger impact on clients than a bigger “win.”
Focus on communication, and you’ll end up with a better reputation than the lawyer who focuses on what it takes to “win” cases. Take care of clients by connecting with them, talking to them, and understanding them, and you’ll get more business than the lawyer with the “amazing” track record of “wins.”
Being a great lawyer by lawyer standards matters to us. Talking to your clients is what matters to clients. Clients pay the bills. Clients refer their friends. Focus on what matters to the clients. Communicate first. Do the lawyer thing between calls.
Lesson #5: Being Successful Won’t Always Feel Like Being a Lawyer
We all grow up with different ideas of what being a lawyer looks like. That vision may be inconsistent with what it takes to build a thriving practice. The lawyers I watched on LA Law didn’t house their data in the cloud, interact with paralegals in India, or run pay-per-click ads on Google. Today, you’d be hard pressed to run a highly profitable practice without doing lots of things lawyers never thought of just a few years ago.
Many of us never dreamed that taking referral sources to lunch would be part of building a successful practice. We had visions of standing up in court, not standing in line at Applebee's. We were prepared to call witnesses, not prospective clients. We wanted to draft orders, not place our order for a sandwich. Being successful doesn’t necessarily match up with what we imagined.
Letting go of our personal sense of what it means to be a lawyer is an important first step to actually being successful. It’s critical that we run our business following a model that makes clients happy, generates income, and provides profit rather than simply meeting some internal, emotional need.
Lesson #6: Moving Up Requires Lots More Education
When I finished law school, I thought I was done with sitting in class and learning stuff. After all, I’d been in school for 20 years at that point. Isn’t 20 years of school enough?
Apparently, 20 years is just the beginning. The learning doesn’t stop, and, if anything, it gets harder. Every practice area requires specialized education.
For me, trial advocacy programs are rigorous and exhausting. Business valuation courses are boring on an epic scale. Learning how mental health professionals diagnose and classify mental illness is tedious. Plus, all this stuff changes and evolves constantly. I learned how to cross-examine the results of the predominant mental health tests. Then they changed the tests—what a nightmare.
Many lawyers stop learning other than through experience. They also stop advancing in the profession. If you’re going to move forward, you’re going to keep learning, and you’re going to make it a big part of what you do each week. Your expertise will move you forward—fast. I had no idea how much continuing education would be required.
Building a new practice is simultaneously a blast and a nightmare. The learning is fascinating and frightening. Even with these six lessons, you’ll still be shocked by all the lessons you learn on your own. Hopefully, these six lessons make the experience a bit more manageable.
Now we’d love to hear from you: what’s one thing you wish someone had told you before you hung out your shingle?